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Viability Stays at Core of Strategies

Viability Stays at Core of Strategies

Regional Capabilities:

April 5, 2012

The National Planning Policy Framework (NPPF) emphasises the
need for careful attention to viability to ensure development plans
are deliverable across the economic cycle. A High Court judgement
from Bromley in south London confirms that plan allocations and
policy requirements must be grounded in a genuine understanding of
viability and a meaningful assessment of alternative
strategies.

A consortium of owners, including Linden Homes, of a key
opportunity area site objected to its treatment in a draft town
centre area action plan (AAP). The site was allocated for "around
250" homes, including family ones. The plan also required decked
car parking, adding significantly to costs. Linden Homes objected
on the grounds that too much planning gain was sought, given the
financial effects of the "around 250" restraint and the parking
requirement.

It submitted detailed planning and viability evidence to show
that delivery was unrealistic unless the residential allocation was
increased to around 500 flats, rather than family homes, to
generate enough profit. On that basis, it argued that the plan
allocation was unsound because it was not viable or deliverable.
The local authority had not provided an up-to-date market
assessment, it noted.

However, the AAP,
described by the local plan inspector as "essentially sound", was
adopted. Linden Homes then sought a modification under the powers
to challenge strategies and plans in section 113 of the Planning
and Compulsory Purchase Act 2004. The inspector had concluded that
the plan allocation would be viable across the AAP period as a whole. The judge found
that this conclusion cut across the firm's uncontested viability
evidence to such an extent as to suggest that the conclusion was
purely speculative. He added that there was a lack of evidence that
any alternatives had been considered. Declining to modify the
AAP, the judge quashed
parts of it and directed the authority to adopt a separate
AAP for Linden Homes'
site in due course.

The NPPF says less than
previous guidance about contingency planning to ensure
deliverability of allocations and little about monitoring and
managing such delivery. Nonetheless, authorities will have to show
that planned infrastructure and the allocations it serves can be
brought forward in a timely way and that reasonable alternatives
have been explored.

In particular, affordable housing policies will need to be
sufficiently flexible to reflect changing market conditions. There
will need to be real scrutiny of how well existing and future
policies meet this requirement, and the mechanisms needed to give
it effect. The case confirms that a realistic assessment of
economic feasibility is needed for authorities to plan positively
and for plan examiners to exercise their judgement safely.

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